Nvidia’s stock slipped after reports that Meta may shift toward Google-designed chips, adding to uncertainty in a tech sector already experiencing competitive churn. The economic backdrop shows a widening divide between Canada and the United States as both countries head toward year-end data releases.
BNN Bloomberg spoke with Jack Manley, global market strategist at J.P. Morgan Asset Management, who says Canada’s near-flat growth, weaker labour conditions and greater sensitivity to higher rates continue to drag on performance, even as U.S. momentum remains solid.
Key Takeaways
- Canada’s third-quarter GDP is expected to be flat, extending the country’s underperformance compared with strong U.S. economic growth.
- Canada remains more exposed to shifting trade policy and higher borrowing costs, which are hitting consumers and dampening activity.
- The labour market in Canada is weakening relative to the U.S., with softer payrolls and a higher unemployment rate.
- The TSX outperformed in 2025 on favourable valuations and sector-specific gains, but those catalysts are unlikely to repeat in 2026.
- U.S. equities continue to offer a stronger long-term outlook, with Canada functioning more as a cyclical hedge.
Read the full transcript below:
ROGER: Nvidia shares are down on reports that Meta is considering using chips designed by Google. Let’s get more on this with Jack Manley. He is global market strategist at J.P. Morgan Asset Management. Jack, thanks very much for joining us.
JACK: Thank you for having me, Roger.
ROGER: A bit of a shakeup today with what’s unfolding. How are you reading all this?
JACK: I think what’s going on today really underscores a couple of things. It underscores the risk of making any single, big, concentrated bet on one particular security. But it also highlights something we see happen over the course of many technological revolutions — the idea that leadership passes from one company to another as a technology matures.
In the past, that leadership change has typically gone from the “makers” to the “takers.” The makers are the companies laying the groundwork and building the infrastructure. The takers are the upstarts that show up, take that technology and revolutionize a business model. That’s probably less of a risk right now. These companies have a lot of cash, they’re loosely regulated and they can gobble up upstarts very quickly. But there is certainly some risk of the big players jockeying for position. All it takes to get good in this space is money — and these companies have plenty of that. So this isn’t surprising to me. It was more a question of when, not if, something like this would happen.
ROGER: Does this leave Nvidia on the outside looking in, or is there still lots of room?
JACK: I wouldn’t say that necessarily. There is so much money sloshing around in this space. There is so much fiscal and administrative support for AI and the buildout, particularly in the United States. There are plenty of opportunities for different players in the AI world to continue making quite a bit of money. I wouldn’t say anyone is being pushed out at the moment.
ROGER: I want to move to GDP. Canada’s numbers are coming out this week, and what a big difference. The U.S. is tracking close to four per cent, while we’re likely going to be flat. They’re leaving us behind.
JACK: First of all, I’m envious that you’re getting your numbers out on time. We were supposed to get our third-quarter print a couple of weeks ago, and that didn’t happen because of the shutdown. But we do have insight into how the numbers are shaping up. Third-quarter growth in the U.S. looks fairly strong, close to four per cent. Third-quarter growth in Canada looks close to flat.
This divergence is something we’ve been seeing for quite some time, long before the trade war kicked off. Going back to the pandemic, there has been significant divergence in economic performance between the two countries. It underscores the headwinds the Canadian economy — and particularly the Canadian consumer — is facing.
Higher interest rates are more quickly transmitted in Canada through mortgage refinancing. U.S. policy changes have been confusing and at times negative for economic activity, and Canada is tightly tied to the U.S. — with roughly 25 per cent of GDP coming from exports, and 75 per cent of those heading to the States. And then you have a labour market that is considerably slacker in Canada. What we’ll see Friday, I think, is confirmation of a story we’ve been telling for a while.
ROGER: Is this a transition for Canada, or is this something we still haven’t figured out?
JACK: I don’t think anyone has really figured it out. The rules of engagement, especially around trade, are touch and go. They change frequently. Looking ahead to 2026, it’s going to be more policy noise. Washington has been noisy for a long time, and Ottawa may join in next year. Policy change is going to remain a big theme for investors in 2026, injecting uncertainty into the macro landscape.
ROGER: And in the middle of all this, you have the TSX outperforming the S&P 500. We’ll just throw that in there.
JACK: It’s interesting. The divergence from an economic perspective has been negative for Canada, but the divergence from a market perspective has been positive. It’s a reminder that the economy and the stock market are not mirror images of one another.
The TSX caught a bid from a few things this year. Valuations were compelling at the start of 2025. The TSX was cheap relative to its history and to the U.S. market. Some very sector-specific stories helped too — gold up roughly 40 per cent, which boosted miners, and a more benign rate environment that helped banks.
I like what happened to the TSX this year; it makes sense. But I would be cautious about reading too much into the 2025 outperformance and assuming it can be replicated in 2026. I am not looking for another 20-plus per cent return year, and I’m not expecting Canadian equities to outperform U.S. equities next year.
ROGER: We’ll leave it there. Jack, thanks as always for joining us.
JACK: Thanks for having me. Great to be here.
ROGER: Jack Manley is global market strategist at J.P. Morgan Asset Management.
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This BNN Bloomberg summary and transcript of the Nov. 25, 2025 interview with Jack Manley are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
